FFIEC Announces Availability of 2018 Data on Mortgage Lending

ByRegulatory News

FFIEC announced the availability of 2018 data on mortgage lending transactions at U.S. financial institutions covered by the Home Mortgage Disclosure Act (HMDA). The covered institutions total nearly 5,683 and include banks, savings associations, credit unions, and mortgage companies. The data cover lending activity on or before August 07, 2019 and include 48 data points providing information about the applicants, loan origination, the property securing the loan or proposed to secure the loan in the case of non-originated applications, the transaction, and identifiers. Appendix A of the FFIEC filing instructions guide for HMDA data collected in 2018 contains the complete list of HMDA data points and the associated data fields.

Many of the data points are available for the first time under the HMDA data. The data indicated that approximately 424,000 applications were for commercial purpose loans and approximately 57,000 applications were for reverse mortgages. Overall, credit score information was reported for 73.1% of all applications. Equifax Beacon 5.0, Experian Fair Isaac, and FICO Risk Score Classic 04 were the three most commonly reported credit scoring models at 22.8%, 18.8%, and 18.2% of total applications, respectively. For originated loans, the median primary applicant scores for these three models were between 738 and 746. This compares to medians ranging from 682 to 686 for denied applications. Combined loan-to-value ratio (CLTV) was reported for 74.3% of total applications while debt-to-income ratio (DTI) was reported for 75.3% of total applications. Additionally, the 2018 HMDA contains additional pricing information. It was also reported for the first time in data that indicated approximately 424,000 applications were for commercial purpose loans and approximately 57,000 applications were for reverse mortgages. The data show that the share of mortgages originated by nondepository, independent mortgage companies has increased in recent years.

Overall, the 2018 data include information on 12.9 million home loan applications, with 7.7 million applications resulting in loan origination. The total number of originated loans decreased by about 924,000 between 2017 and 2018, or 12.6%. Refinance origination decreased by 23.1% from 2.5 million and home purchase lending increased by 0.3% from 4.3 million. A total of 2,251 reporters made use of the partial exemptions under the Economic Growth, Regulatory Relief, and Consumer Protection (EGRRCP) Act for at least one of the 26 data points that are eligible for the exemptions. In all, they account for about 425,000 records and 298,000 origination. The HMDA data is the most comprehensive publicly available information on mortgage market activity. The 2018 HMDA data reflect metropolitan statistical area definitions released by the Office of Management and Budget in 2017 that became effective for HMDA purposes in 2018. HMDA data alone cannot be used to determine whether a lender is complying with fair lending laws. The data do not include some legitimate credit risk considerations for loan approval and loan pricing decisions.